Correlation Between Taeyang Metal and Genie Music
Can any of the company-specific risk be diversified away by investing in both Taeyang Metal and Genie Music at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Taeyang Metal and Genie Music into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Taeyang Metal Industrial and Genie Music, you can compare the effects of market volatilities on Taeyang Metal and Genie Music and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Taeyang Metal with a short position of Genie Music. Check out your portfolio center. Please also check ongoing floating volatility patterns of Taeyang Metal and Genie Music.
Diversification Opportunities for Taeyang Metal and Genie Music
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Taeyang and Genie is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Taeyang Metal Industrial and Genie Music in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genie Music and Taeyang Metal is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Taeyang Metal Industrial are associated (or correlated) with Genie Music. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genie Music has no effect on the direction of Taeyang Metal i.e., Taeyang Metal and Genie Music go up and down completely randomly.
Pair Corralation between Taeyang Metal and Genie Music
Assuming the 90 days trading horizon Taeyang Metal Industrial is expected to generate 1.25 times more return on investment than Genie Music. However, Taeyang Metal is 1.25 times more volatile than Genie Music. It trades about -0.21 of its potential returns per unit of risk. Genie Music is currently generating about -0.33 per unit of risk. If you would invest 519,000 in Taeyang Metal Industrial on August 27, 2024 and sell it today you would lose (81,500) from holding Taeyang Metal Industrial or give up 15.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Taeyang Metal Industrial vs. Genie Music
Performance |
| Timeline |
| Taeyang Metal Industrial |
| Genie Music |
Taeyang Metal and Genie Music Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Taeyang Metal and Genie Music
The main advantage of trading using opposite Taeyang Metal and Genie Music positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Taeyang Metal position performs unexpectedly, Genie Music can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Genie Music will offset losses from the drop in Genie Music's long position.| Taeyang Metal vs. AptaBio Therapeutics | Taeyang Metal vs. Daewoo SBI SPAC | Taeyang Metal vs. Dream Security co | Taeyang Metal vs. Microfriend |
| Genie Music vs. AfreecaTV Co | Genie Music vs. SS TECH | Genie Music vs. Busan Industrial Co | Genie Music vs. Busan Ind |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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